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Music swapping through the mail

A new company hopes to make it easy (and legal) to swap music using a …

A new startup plans to announce a CD-swapping service today that tries to find a middle ground between ripping off music and paying full price for it. La la Media will announce its own online swap shop, where consumers can find discs and arrange for trades with other members online. The service will use prepaid envelopes (like Netflix) for sending the discs through the mail, and will charge users $1.49 per swap, with a dollar going to La la Media and the rest set aside to cover shipping. Sounds like a cheap way to build up your music collection, right?

It sure does, and that's why the service will no doubt attract the scrutiny of the RIAA. The founders of the new company claim that they are walking the straight and narrow with the new venture.

"La la founders argue that, unlike underground online file-sharing services, which have been sued for copyright infringement, La la is protected under an exception to the U.S. Copyright Act. They argue that the owner of a CD can transfer a legally-acquired copy without permission or payment of additional royalties."

And of course they're right. The hitch is that users who swap CDs aren't allowed to keep copies of the music for themselves; if you sell the disc, you're not just selling a thin piece of plastic, but a license to the music contained on it. The service will be perfectly legal if members simply swap discs without keeping copies, but that's about as likely as finding a box of gold doubloons buried in my backyard.

In the end, the service may not satisfy either the RIAA or the file-swapping community at whom it seems to be targeted. The RIAA will no doubt see it as one company's attempt to profit from file-swapping by giving it a veneer of legitimacy, while file-swappers will still be breaking the law, but paying for the privilege. Certainly the service has legal uses, but that hasn't been enough to keep many file-swapping networks in existence. In this case, though, the RIAA will have a much harder time proving any potential piracy claims, and La la Media is trying to soften up the industry by offering twenty percent of its revenue to artists even though it has no legal obligation to do so. Will these factors be enough to keep the company out of the courtroom?